Happy Friday! ‘This week in CX’ brings you the latest roundup of industry news.
This week, we’re exploring the growing tension in the work-from-home debate, how Gen Z employees are driving the shift toward remote work, and why adding a human touch can ease the struggles of AI adoption.
We’re also discussing new updates from Mercedes-Benz, Birkenstock and more.
Key news
- Major European carmakers are expecting profits to take a hit this year as looming tariffs and regulations threaten to eat into their margins. Renault, one of the few European car manufacturers not to issue a profit warning last year, boasted record operating profit of €4.3bn (£3.6bn) over 2024. But the French group said stricter EU emissions rules would likely lead to lower operating margins in 2025. Mercedes-Benz, meanwhile, braces for “significantly” lower profits this year even without higher US import tariffs. The German company said it aims to lower production costs by 10% by 2027.
- Birkenstock shoes are not works of art, a German court has ruled. The company had wanted its shoes to be classified as artwork to secure stronger copyright protections. The court ruled that there was not enough individuality in Birkenstocks’ designs, adding that “pure craftsmanship” was not enough. Birkenstock had filed the case against German fashion retailers Tchibo and shoe.com, and Danish retailer Bestseller for selling similar shoes. Meanwhile, revenue at Birkenstock rose 19% in the last quarter of 2024 as a result of growth in Asia.
- Life expectancy improvement is falling across Europe, research has found. Growth in life expectancy fell from 0.23 years from 1990 to 2011 to 0.15 years from 2011 to 2019. Experts say poor diet, inactivity and obesity are the causes. Deaths from heart disease also fuelled the decline between 2011 and 2019. The four nations of the UK saw the greatest decline, with England the worst, where life expectancy growth fell from 0.18 to 0.07 years over the same period. Norway, Iceland, Sweden, Denmark and Belgium maintained or boosted life expectancy growth.
CXM news stories
Here’s the full news stories that CXM have reported on in the past week. Learn all about the latest news about the work-from-home conflict, as well the importance of human-AI balance.
AI data breaches looming: over 40% linked to generative AI misuse by 2027
According to Gartner, by 2027, over 40% of data breaches related to artificial intelligence will result from the misuse of generative AI across borders. Users’ rapid adoption of GenAI technologies has outpaced the establishment of necessary data governance and security protocols, raising concerns about data localisation due to the centralised computing demands these technologies impose.
“Unintended cross-border data transfers often occur due to insufficient oversight, particularly when GenAI is integrated in existing products without clear descriptions or announcement,” said Joerg Fritsch, VP analyst at Gartner. “Organizations are noticing changes in the content produced by employees using GenAI tools. While these tools can be used for approved business applications, they pose security risks if sensitive prompts are sent to AI tools and APIs hosted in unknown locations.”
The absence of unified global best practices and standards for AI and data governance compounds these challenges, leading to market fragmentation. This situation forces organisations to devise region-specific strategies, limiting their ability to scale operations globally and fully leverage AI products and services.
The need for AI governance
Gartner projects that by 2027, AI governance will be mandated across national laws and regulations, necessitating organizations to adopt strategic measures to mitigate risks associated with AI data breaches, especially those stemming from cross-border misuse of generative AI.
To comply with international regulations, businesses must improve their data governance frameworks to encompass AI-processed data, ensuring regular privacy evaluations that include data lineage and impact assessments. Establishing governance committees can further bolster oversight, promoting clear communication around AI implementation and data management while managing technical, risk, and compliance aspects.
In addition, organisations should prioritise strengthening data security through advanced technologies, encryption, and anonymization methods to protect sensitive information. Gartner forecasts that by 2026, organizations leveraging AI TRiSM controls will decrease their dependence on inaccurate information by at least 50%, boosting decision-making processes and overall operational efficiency.